Tullow Oil plc ($TLW)

Good morning, ladies and gentlemen, and welcome to our 2026 Annual General Meeting. I'm Roald Goethe, Chair of the Tullow Board. It is now 11:00 a.m. A quorum is present, and I declare the meeting open. I'd like to start by introducing the independent nonexecutive directors of your Board, Rebecca Wiles, Garrett Soden, Euan Shirlow and James Peterkin. And the Executive Directors to my left, Ian Perks, Chief Executive Officer; and Richard Miller, Chief Financial Officer. Before turning to the formal part of the meeting, I would just like to mention a few housekeeping points. The fire exits are located on the immediate left as you exit this room, and we do not expect any fire alarm tests during this meeting. Today's proceedings are being recorded. The format for today's meeting is that I will chair the meeting, and I ask Ian Perks, our CEO, to provide an update on the business. This will be followed by a question-and-answer session with the Board of Directors. We will then move to the formal part of the meeting as we vote on the resolutions we have put forward. All proxy votes received by post or online ahead of the deadline will be included in the results. All the votes taken today will be taken by a poll rather than on a show of hands. It is intended that the results of all the votes will be announced to the London and Ghana Stock Exchanges and published on the company's website as soon as possible after the conclusion of the AGM later today. I will now hand over to Ian.

Thank you, Roald. Good morning, and thank you for joining us. So I'm Ian Perks, and it's great to have the opportunity to meet with you today and introduce myself in person. I've now been with Tullow for 9 months, having joined as CEO in September last year. Prior to that, I have over 30 years of experience in the upstream oil and gas industry. So I'll talk to you today against the backdrop of this slide, which shows a summary of the current state and outlook of our business. I'm pleased to highlight the tremendous progress we've made in creating a stable foundation to deliver improved performance, and I'm encouraged by the momentum we've demonstrated so far in 2026, where results have been excellent during the first 5 months. We're aiming to maintain this momentum and continue to improve operational performance and cash flow management going forward. We currently expect to end the year having delivered against the high end of our production guidance, and this is due to high operational uptime production optimization initiatives and strong production performance from our new wells in Jubilee. We also have a strengthened relationship with the government of Ghana. This is evidenced through the agreement on a gas payment security mechanism, the petroleum agreement extensions and ongoing positive discussions to resolve outstanding receivables. Looking ahead, we have a rich opportunity set ahead of us. And the external geopolitical environment provides Tullow with a credible prospect of creating significant further value for our stakeholders. Having time to deliver this value was at the forefront of our minds during the refinancing process that we completed earlier this year. We're already still have a positive impact from the 4D seismic and ocean bottom node data survey data that's supporting existing future drilling campaigns. And we also see further cost optimization opportunities, including the 10 FPS subpurchases which will support [indiscernible] cash flow management. In 2026, our focus is to transfer value from 2C resource category entity reserves. We've seen near-term low-cost opportunity to achieve this through further technical and engineering studies leading to a growing confidence in the viability of future drilling campaigns and projects. Finally, it's important to note that we retain significant leverage to oil price upside. From a realized price of approximately $68 a barrel in 2025, we've realized approximately $96 a barrel in '26 so far pre-hedging. And the structure of our commodity hedge program leaves at least 60% access to oil price upside and we're seeing the benefit of that so far this year. So I look forward to taking any questions you may have, but I'll hand back to Rod.

Thank you. All right. We will now take questions on the performance of the business or any other matters that you may wish to raise. Just to remind you, if you do have questions on any of the individual resolutions now is the time to ask them. I will now pass over to our Company Secretary, Adam Holland, who will manage the Q&A process.

Good morning. My name is Adam Holland, and I'm the Company Secretary of Tullow. This year, as we've done in previous years, we are enabling shareholders to participate remotely via webcast. Accompanying the instructions to shareholders on how to join this meeting online. You will have also received instructions on how to submit questions in writing via the virtual meeting platform, which is the platform we're using to host the call. Before asking your question, please give your name and state whether you are a shareholder, proxy or corporate representative. If you are a proxy or corporate representative, please state your name and the name of the shareholder you are representing. Now is the time to please submit any questions you may have relating to the business of the meeting. And for those participating online, you can send in your question using Q&A message box function. You can type your question in the box on the right-hand side of your web page and click send. I will ask any questions for all shareholders to hear enrolled as Chairman of the meeting, will then answer or direct your question to one of his fellow directors. If your exact question is not read out by me, it will be because your question asks the same information as another question that I've already read out. We may not respond to questions unrelated to the business of the meeting, but we will take such questions into consideration as we prepare the half year results update to be released in September 2026. And so now if we would like to take any questions in the room?

I'm [ Henry Chiu ], I'm a shareholder, true interactive investor platform. I note that many of the Board members that you are asking shareholders to vote for or to elect are new. I think I just wonder why the Chairman thinks that this time around, this new Board will do better, given the very check of history of this company.

Well, thank you very much for your question. I think it's important to, number one, stress that we are truly at an inflection point in the, let's say, turnaround of the business. You probably, as a shareholder, followed very closely our success and finally getting the refinancing, albeit for a certain amount of time, but we got the refinancing done. And to let's say, comment a little bit more on the recent achievements and clear, let's say, turnaround of a lot of key indicators for the success of the company. I will afterwards hand over to Ian. But I would also like to stress that we now have a Board which is reconstituted in line with the challenges we are facing. And the choice of the Board currently reflects the challenges that we are facing, as I said, and the skill set is of the new Board members it's been carefully chosen in line with those challenges. And therefore, we strongly believe that we will deliver results for the shareholders, for all stakeholders over the coming next few years. But if I can hand over maybe to Ian to comment a little bit more in detail.

Yes. Thank you for your question. And I think there is a recognition within Tullow that the performance hasn't been where it needs to be. But I do, as Roald said, I think we've reach an inflection point. I think, as I say, the -- we've had a very, very consistent sort of story around creating a strong foundation for improved performance, as I said, building up that platform. We know that it's early days, but 5 months in, the results are very clear. We're going to be near the top end of our production guidance. We've had fantastic availability, great results from the wells. So there is a reason for optimism. And we still have just a rich opportunity set of opportunities, high return, near-term payback that we're getting after. And I think the real benefit that we're seeing is from the seismic that we showed in the OBN, which has really helped us with a much better understanding of the reservoir, and that's going to set us up for success going forward.

My name is Mr. [ Leon Boni ] and everybody would remember me because one remark I left when I left. I said I do not like to give the Board of a company free education. Today, I have 3 questions. One on your strategy paper is set out. I don't know whether the Jubilee line is profitable or still have a traction. Secondly, I do not know the capitalization of this company, I can't find it. So those are 2 distinct questions from telling me that the shared that at onetime worth GBP 14 that would make my value GBP 42,000 to a share that is were just 16p per share. No, you have a duty to carry out AGM, but also you have a duty of care for the ordinary layman who invested in this company and you have not dictate -- you want me to vote for certain people on the Board, but what we are voting, I cannot see the performance per se for the individual you want me to vote for. As you know, the history of this company since [ Adian ] left, been changing the Board regularly. That tells me quite a bit. If people don't go to Tesco, it would collapse. Just like if you are changing the Board often -- this is a free education. If you change in the Board often, they're telling you something is weak in the Board. Regardless who that person is, regardless if we come from Ghana, on South Africa, I have ties in South Africa now. So if you can answer the 2 basic questions the capitalization of this company and the latest of Jubilee line because in South America, people that take a reference what has happened to the Jubilee line reference if it's a failure or shocked. So I'll give you 3 important questions. I might work weekly wages. If you can answer them clearly.

Well, thank you very much. So the question is well noted. I think on the Jubilee, I would like to refer that to Ian because he is definitely the one to be able to answer that on a very qualified fashion.

Yes. So I mean, I think, obviously, we did have some challenges on Jubilee production in the recent past. But I think, as I said, we turned the corner of the 40 [indiscernible] Okay, sure. Yes. So just to take your question on Jubilee. I think it's a world-class asset. There's no doubt about that by any standards. So I think we had some challenges on production last year, as you've seen from the results this year we're starting to see much better production performance, much better uptime. And in terms of the new wells that we brought on stream this year all are performing well, and we still feel optimistic. We've got 3 wells to come on one later this week, early next week and then 2 further in July. We feel optimistic about those wells. We have a water injection well in the end of the campaign in September. And now we're working with partners around a new drilling campaign to get after the second half of next year. So we still see it's a world-class asset with great opportunities for future drilling and future investment. On the capitalization point, I think I'll hand over to Richard on that one.

Yes. So the current market cap of the company today, based on the share price is about $300 million. and we have about $1.4 billion at the end of last year of net debt. So the total enterprise value of the company is around $1.7 million. .

I could not understand when the gentleman was talking about the [indiscernible] per capital spend is not due to show any profit to the Tullow Oil within the next 18 months. Is that correct or wrong?

Yes. So that's incorrect. The total OpEx per barrel on Jubilee is about $8. We sold our last cargo at $119 a barrel. So the profit on the operating basis for Jubilee is material.

And also, they didn't -- who paid this $8 a barrel? Who pays for it? Is it the Ghanan government or the people who are transferring all through Kenya?

So Tullow pays the operating costs to various service contractors that we use to provide and to the people involved in producing the [indiscernible]

[indiscernible] just tell me the page. That's all I need to know.

Okay. You bear with me. I'll update you afterwards on what exact page.

If we'd like to take any other questions in the room?

[indiscernible] shareholder. I do echo the sentiments of the last shareholder, our shareholders we were buying for pensions and savings and shares at about GBP 12. Now they've some really low to about 14p. I do hope the Board shares are disappointed with these results. Just from the layman's view of the income statement, it looked like the biggest profit, which was pretty good, came from discontinued items. So why on earth was being discontinued $135 million from discontinued items. Why are they being -- why is the project being discontinued? That's the first one. And the second one, I noticed as well a long performance-related contracts for the Board. Are any of these performance contracts, incentives related to the share price as do most companies? And if not, why not?

Richard, if you could reply that, especially on the discontinued items.

Yes. So on the discontinued items operations, this refers to our sale of our business in Gabon. The majority of the profit that contributes to the number that you're referencing is a gain on sale. So we were able to achieve a sales price, which was well in excess of the book value, which generated a one-off profit rather than referring to a business that's generating material profits that we've disposed of. So it was a one-off gain on sale.

It's one of the problems the company has that they have to receive finance from the Ghanaian government, and that's just not forthcoming and however much you produce if the government don't pay their rebates or whatever they're meant to do, then the company is still in trouble, isn't it?

Yes. So on the receivables, I think we recognize that, that's been an issue for the company. As I mentioned, we've got a very strong relationship with the government of Ghana. I think that's evidenced, we've got a number of issues that we're working through with them. We started with the license extensions. We've also got security mechanism for gas receivables, which was a key reason behind the growing receivables we had from the government and we've got ongoing discussions with them. So by the end of this year, we expect to be in a much, much healthier position with the government receivables position.

How much roughly does the government owe the company?

As at the end of last year, it was $220 million. But as Ian said, we've made significant progress on that amount so far this year, and we should be in a much, much better position by the end of this year.

We're currently getting paid for our gas after the mechanism that we put in place.

Are you actually getting any interest on this big debt? And the performance contracts, are they related to the share price at all?

So I can respond to that. We have a long-term incentive plan that incentivizes the executive team aligned with the interest of all stakeholders, and that does include linkage to the share. So yes, there is alignment between the executive performance payout and the share price.

Thank you for your question. Are there any other questions in the room? And so I'm just checking online to see if any questions have been submitted via the online platform that we're using today to host the call. Cannot see any questions. And so that concludes the Q&A session, and I will now hand back to Roald.

Thank you, Adam. We now move to the formal business of our AGM. The notice of this Annual General Meeting dated 27th April 2026 explains the business to be proposed and voted on today. The notice of meeting ended 2025 annual report and accounts were made available to all shareholders, either electronically or distributed in hard copy or via the notice of availability informing you the documents are available on our website. Accordingly, the requisite notice of the meeting has been given. I propose, therefore, that with your consent, the notice of meeting should be taken as read. Thank you. In accordance with best practice, the directors have once again decided to conduct each vote on the solutions set out in the AGM notice by way of a poll, which provides an opportunity for shareholders who are not present today to vote their shares. For those attending the meeting online, the voting options will be on your screen. To vote, simply select your voting direction from the options shown on screen. Your vote has been cast when the check market peers. If you wish to change your vote, select change my vote. If anyone in the room with us who is entitled to vote does not have a poll card please raise your hand now, and we will arrange to get one to you. Please remember that you do not need to complete the poll card if you have already returned a form of proxy unless you wish to change your vote. As the Chair of this meeting, I will be voting on behalf of all shareholders who have duly appointed the chairperson of the meeting as a proxy and in accordance with how each shareholder has indicated they wish me to vote on the proxy form. In respect of those proxies where the chairperson of the meeting has been granted discretion as to how to vote in respect of a resolution, I will vote in favor of the resolutions. Those completing a poll card should put a cross in what the boxes marked for, against or withheld in accordance with the way you wish to cast your votes for each resolution. As we noted that withheld is not a vote and will not be counted as a vote For or Against the resolution. The results such -- the results of each of the polls which will include all votes cast today by the shareholders present in the room and all proxy votes submitted by post or using the online voting facility will be announced to the London and Ghana Stock Exchanges as soon as they are available, which ought to be no later than 6:00 p.m. this evening. The results also be posted on the company's website later today, and copies may be obtained at the company's registered office tomorrow. That concludes the business of this meeting. I thank you all for your attendance and declare the meeting closed.